1. Chinese Copper Smelters to Trim Output in Response to Falling Margins

On July 16, Chinese smelters Daye Nonferrous Metals (HKEX:0661) and Baotou Huading Copper Industry Development made headlines following their decision to cut production outputs in 2025.

The former, a major company, reported a planned 20 percent cut, while the latter, a smaller firm, announced a 40 percent reduction.

Both smelters attributed the decrease to “diminishing profit margins caused by an ongoing shortage of ore concentrate,” as reported by Bloomberg.

Other factors affecting the decision include the decrease in smelter utilization rates caused by low treatment and refining charges towards the end of 2024 and significant production losses.

Daye Nonferrous Metals’ half-year earnings reveal revenue was up by 55 percent compared to the first half of 2023, largely attributed to a resumption of smelting at its plant.

2. BHP: Global Copper Demand to Surge 70 Percent by 2050

Mining giant BHP (ASX:BHP,NYSE:BHP,LSE:BHP) forecast that copper demand will reach over 50 million metric tons by 2050.

In a September 30 report, BHP said, “Unlike the 20th century, where the adoption of cars, electricity, consumer electronics and white goods occurred at different times across various regions, we expect to see more-or-less concurrent adoption of the copper-intensive technologies of EVs, renewables and data centres around the world.”

The company anchored its predictions on several factors, namely traditional economic growth, the ongoing global energy transition and the expansion of digital infrastructure.

Global efforts are currently intensified to curb greenhouse gas emissions, resulting in a projected rise in copper demand.

Current copper mines are expected to supply more than half of the copper needed to meet global demand over the next decade. However, by 2035, production from these mines could decline by 15 percent due to decreasing ore grades, highlighting the urgent need for significant investment in upgrades and new projects to sustain supply.

Despite these challenges, the pace of new copper discoveries has dramatically slowed, with only four major finds in the last five years. This scarcity of greenfield projects poses a substantial challenge to meeting future demand.

In summary, major market players like BHP will need to adopt innovative strategies and make substantial investments to bridge the gap, ensuring a stable supply of copper as industries increasingly rely on the metal for clean energy solutions.

3. IEF: World Needs 35 to 194 New Copper Mines by 2050 to Support Massive Demand

The International Energy Forum (IEF) also published a significant copper report in 2024, which highlighted the need for more copper mines by 2050 and government support and incentives for these projects.

The report singled out limited exploration as one of the copper market’s biggest challenges at the moment. It also discussed the long periods between discovery and production.

“New copper mines that started operation between 2019 and 2022 took an average of 23 years from the time of a resource discovery for mines to be permitted, built, and put into operation,” it said.

The IEF detailed multiple copper demand scenarios through 2050. For business as usual there would need to be 35 new copper mines by 2050; EV plus grid would require 54 new copper mines; and net-zero by 250 would require a massive 194 new copper mines.

IEF Secretary General Joseph Mongle emphasized that without changes in current policies, 100 percent realization of EV adoption would not be possible.

“To make the best use of available copper supply, governments should prioritize economy-wide electrification, which is the foundation of climate policy. Moreover, governments need to incentivize and support new copper mine projects,” he said.

4. LME Sanctions on Russian Metal Push Copper, Nickel and Aluminum Prices Higher

On April 12, the British government and the US Department of the Treasury announced bans of Russian aluminum, nickel and copper on the London Metal Exchange (LME) and Chicago Mercantile Exchange (CME).

The LME is the oldest and largest metals trading forum in the world, responsible for setting benchmark prices for metals such as aluminum and zinc.

The news led to increases in the prices for all three metals, with aluminum jumping 9.4 percent — its largest one day increase since 1987 — nickel soaring by 8.8 percent and copper getting a smaller 1.6 percent bump.

The restrictions cover any metal produced in Russia starting April 13. Owners of Russian metal produced before the said date were allowed to place their metal on LME warrant, provided they furnish evidence of production dates.

The ban is part of continuing sanctions imposed by the US and UK on Russia due to its invasion of Ukraine. Trading of Russian metals outside of the LME and CME’s systems is not included in the ban.

There have been no updates on the restrictions as of this writing.

5. Goldman Sachs Cuts Copper Price Forecast on Weak Chinese Demand

While the reports above discussed the increasing demand for copper, China’s demand for the red metal was reportedly weakening due to a slow economic recovery.

Supporting this claim was American investment bank Goldman Sachs (NYSE:GS), which in September significantly lowered its 2025 copper price forecast due to that factor. The firm reduced its prediction to US$10,100, a large dip from the previous US$15,000 forecast.

According to Bloomberg, the US$15,000 prediction came from former analysts Jeffrey Currie and Nicholas Snowdon, while the new outlook was outlined in a note by analysts including Samantha Dart and Daan Struyven.

‘Softer-than-expected China commodity demand, as well as downside risks to China’s forward economic outlook, lead us to a more selective, less constructive tactical view of commodities,’ the analysts said.

Copper reportedly had an average monthly price of over US$9,000 per metric ton in November, down from its over US$11,000 per metric ton price record in May.

1. Biden Signs Bill Banning Russian Uranium Imports, Restrictions to Begin in 90 Days

Among the biggest uranium news during the first half of 2024 is the United States’ Prohibiting Russian Uranium Imports Act, which was signed into law by US President Joe Biden on May 13 after it received unanimous approval in the Senate on April 30.

The act, which took effect on August 11, ended the country’s three-decade dependence on Russian uranium.

The US said that it is focused on American uranium production and enrichment. Centrus Energy (NYSEAMERICAN:LEU), the country’s biggest trader of enriched uranium from Russia, is also producing high-assay low-enriched uranium (HALEU) at the American Centrifuge Plant in Piketon, Ohio.

The Piketon demonstration project has reportedly enriched more than 100 kilograms of HALEU and is expected to ramp up production to 900 kilograms in the coming years.

Under the new law, the Department of Energy (DOE) is allowed to issue waivers authorizing Russian uranium imports according to limits established in an anti-dumping agreement. This usually is for cases where buyers are not able to find an alternative option.

The statute is set to expire at the end of 2040.

2. China Approves 11 Nuclear Reactors in US$31 Billion Green Energy Investment

China made headlines when it announced its approval of 11 nuclear reactors across five major areas: Jiangsu, Shandong, Guangdong, Zhejiang and Guangxi.

State-owned entities China National Nuclear (CNNC) and China General Nuclear Power Group (CGN) were assigned to oversee the construction of the majority of these projects.

According to China, the construction of these reactors forms part of its broader strategy to significantly increase its nuclear power capacity by 2035.

The country’s nuclear power capacity can cover about 5 percent of its electricity demand right now, and it plans to double this to 10 percent by 2035, coinciding with a massive expansion in wind and solar projects.

December 2024 statistics from the World Nuclear Association show that 65 reactors are under construction across the world, 29 of which are in China, with 90 more being planned globally.

3. Russia Restricts US Uranium Exports, Retaliating to American Ban

As a response to the US’ ban on Russian uranium imports, Russia announced its temporary restrictions on enriched uranium exports to the US on November 15.

The ban, which will be in place until December 31, 2025, applies to all products under the definition ‘uranium enriched with the isotope uranium-235” and does not include the exports under one-time licenses issued by the Russian Federal Service for Technical and Export Control.

Like the US’ allowance of waivers, the Russian decree also accounts for special cases where companies with permits from the export control watchdog are allowed to export uranium to the United States.

The move came two months after President Vladimir Putin said in a September 11 government meeting that Moscow should consider limiting exports of key metals such as uranium, titanium and nickel in retaliation for Western sanctions.

4. US to Spend US$2.7 Billion on Low-enriched Uranium from Domestic Sources

Nearly a month before the US ban on Russian uranium import took effect, the country said that its Department of Energy (DOE) would purchase up to US$2.7 billion worth of low-enriched uranium from domestic sources.

The proposal, issued on June 27, said that the purchase would “enhance national energy security and create new jobs in the nuclear industry.”

In December, the DOE penned supply contracts with six companies: Centrus Energy subsidiary American Centrifuge Operating, General Matter, Global Laser Enrichment, Louisiana Energy Services, Urenco USA’s Laser Isotope Separation Technologies and Orano Federal Services.

“(These companies) will be able to compete for future work to supply LEU, fostering strong commercial sector investment,” the DOE press release read.

According to the DOE, all contracts are valid for 10 years and each company receives a minimum contract of US$2 million.

This move, along with other initiatives, are discussed in the DOE’s Pathway to Advanced Nuclear Commercial Liftoff report, which supports the advancement of technologies that can help the US achieve net-zero emissions by 2050.

5. Paladin Energy to Acquire Fission Uranium in C$1.14 Billion Deal

The biggest uranium acquisition news of 2024 is the C$1.14 billion deal between Paladin Energy (ASX:PDN,OTCQX:PALAF) and Fission Uranium (TSX:FCU,OTCQX:FCUUF), which was announced on June 24.

The terms of the agreement state that “Paladin will acquire 100 percent of the issued and outstanding shares of Fission, while Fission shareholders will receive 0.1076 fully paid shares of Paladin for each Fission share they hold.”

Once completed, Paladin shareholders will hold 76 percent of the company, while Fission shareholders will collectively hold the remaining 24 percent.

Paladin received the final approval from Canadian authorities to perform the acquisition on December 18, and the deal officially closed on December 23.

“The combination of Paladin and Fission creates a world-class diverse uranium producer operating in multiple countries, with a high-quality portfolio of production, development and exploration assets,” Paladin CEO Ian Purdy said in a December 19 press release.

US cannabis market

Cannabis is federally illegal in the US, but state market openings have allowed some operators to thrive. Typically these firms set up vertically integrated businesses with a focus on branded products, retail networks and licenses.

While these companies have adapted to regulatory challenges, they have much to gain from country-level reform in the US, and are eager to see more welcoming federal laws that will allow their businesses to develop further.

US-focused cannabis fund

The AdvisorShares Pure US Cannabis ETF (ARCA:MSOS) provides exposure to public companies exclusively operating within the US cannabis industry. By investing in companies that are working in states with clear guidelines, MSOS gives investors a way to be more selective about the types of cannabis companies they’re investing in.

Canadian cannabis market

In 2018, Canada became the first G7 nation to legalize adult-use cannabis and create its own streamlined program regulated by both federal and provincial powers. Since then, companies working in the country have faced ups and downs in dealing with tight marketing rules, high tax rates and ongoing competition with the unregulated market.

Canada-based cannabis fund

The Global X Marijuana Life Sciences Index ETF (TSX:HMMJ) was the first cannabis ETF available in Canada, and it holds a variety of publicly traded companies involved in cannabis, along with several non-flower companies.

While HMMJ does not invest in US-based multi-state operators, it does have exposure to the US market through Canadian companies that have interests in the US cannabis industry. Overall, HMMJ is designed to give investors broad exposure to the cannabis industry, with a particular focus on North American companies.

This ETF had a year-to-date loss of 0.32 percent as of December 23 and a price point of C$9.29.

FAQs for investing in cannabis

Rescheduling and Regulatory Changes

A shift in federal drug policy could be on the horizon for the cannabis industry if it is rescheduled from a Schedule I to a Schedule III substance in 2025.

In May, the US Department of Justice initiated the process to potentially reschedule cannabis on the recommendations of the US Department of Health and Human Services (HHS).

In August, the US Drug Enforcement Administration (DEA) published a Notice of Proposed Rulemaking in the Federal Register, an important step in the formal process of rescheduling.

On November 26, after a public comment period, the DEA announced it would hold a formal hearing on the matter.

If successful, this move has the potential to significantly benefit cannabis businesses by removing barriers to essential services like banking and patent protection. However, the process has encountered delays and is now not expected to be finalized until late 2025.

On October 31, the trial was postponed from December 2 until early 2025 when Chief Administrative Law Judge John Mulrooney II challenged the process by which the DEA selected its witnesses, requesting more information on the qualifications of those set to testify.

“Indeed, the [Participant Letter] contains only a list of persons and organizations accompanied by one or more email addresses, without the benefit of notices of appearance, addresses, or even phone numbers,” the Judges order says, as reported by Marijuana Moment. Judge Mulrooney gave the DEA until November 12 to “provide its counsel(s) of record who will be appearing in these proceedings, as well as any known conflicts of interest that may require disclosure.”

On November 20, Judge Mulrooney ruled who could testify in the trial. The decision came after some witnesses withdrew their requests to participate. Nearly everyone on the list was approved, with only a few exceptions.

Following a motion to remove the DEA as a proponent of rescheduling on allegations that the agency conspired with a prohibitionist group — a charge the agency denies — Judge Mulrooney ruled that such a decision would be beyond the jurisdiction of the ALJ’s office. The resolution of this matter remains uncertain. A preliminary hearing to address procedural matters for rescheduling was held on December 2 with no witness testimony.

Adding to the complications, federal health officials denied the DEA’s request to have HHS officials testify at the 2025 hearing. This prompted the DEA to request that Judge Mulrooney subpoena HHS representatives, which was granted.

The outlook for cannabis reform, once seemingly straightforward, is now uncertain, particularly regarding the timing and likelihood of rescheduling.

During a roundtable discussion with cannabis industry leaders, Cannabis Science and Technology inquired as to how the results of this election might impact the rescheduling of cannabis.

Kim Anzarut, CEO and founder of Allay Consulting, replied “With Trump’s re-election, Trump might continue to leave cannabis policy largely to the states but could lean toward rescheduling if it proves to be a popular move that aligns with GOP support for states’ rights.”

Anzarut continued: “On the other hand, new leadership could prioritize rescheduling or even push for full legalization to align with social equity and justice reform efforts. Either way, the FDA and DEA are being directed to reevaluate cannabis’ current status, which will set the stage for the inevitable regulatory overhaul.”

David Vaillencourt, founder and CEO of The GMP Collective, chairman of S3 Collective and Vice-Chair of ASTM International Committee D37 on Cannabis Standards, also expressed his thoughts: “Trying to forecast what a Trump administration might do is like picking stocks based on a fortune cookie: amusing but unreliable.”

“That said, there is reason for cautious optimism. Trump’s pick for Secretary of Health and Human Services – assuming he is confirmed by the Senate – Robert F. Kennedy Jr. supports natural medicine and criticizes the FDA’s rigidness. Additionally, we saw Trump endorse Florida’s Amendment 3 to legalize adult-use cannabis. Whether this signals a genuine shift or a strategic move to outmaneuver (Ron) DeSantis is anyone’s guess,” he added.

Trump has signaled a willingness to support cannabis legalization, but several of his cabinet picks have either voted against measures to advance legislation related to the industry or spoken out against cannabis reform.

If rescheduling is successful, it would also remove the trigger for the Internal Revenue Service tax code 280E to apply, which prevents cannabis business owners from deducting regular business expenses.

Even if rescheduling efforts falter, the SAFER Banking Act, which passed a House vote with bipartisan support in 2023, could provide much-needed access to financial services. However, the act is unlikely to pass through the Senate before the current Congress ends on January 3, 2025, effectively sending the initiative back to square one.

Despite this setback, there may be renewed hope for banking reform as Rep. French Hill (R-AR), a supporter of cannabis banking legislation, has been selected to serve as chair of the House Financial Services Committee.

While the US grapples with these rescheduling and banking complications, Health Canada is proposing a series of changes to ease the administrative burden and reduce spending and wait times.

Some of the changes proposed in June include simplifying licensing, production and security clearance requirements, increasing production limits for “micro-cultivators” and making it easier for licensees to submit required reports to Health Canada. Comments submitted by the public are currently under review.

Market Expansion and Business Opportunities

The cannabis industry is primed for growth, with US sales projected to hit US$71.8 billion by 2028, according to Ocean Como’s 2024 Cannabis Industry report citing IBIS World data.

This upward trajectory will be fueled by legalization efforts, new market entrants and product innovation.

Research and product development will maintain their importance as the industry adapts. This creates opportunities for businesses specializing in research, testing and product formulation. The reclassification could also attract research funding from the healthcare and wellness sectors, interested in cannabis-based therapies and treatments.

Maridose, a DEA-licensed cannabis producer, launched a Series A funding round at the Benzinga Cannabis Capital Conference in October. Earlier, after the DEA initiated rescheduling proceedings in May, Maridose told Reuters that it had “been receiving more inquiries from both non-profits and commercial entities, including state-licensed cannabis firms.”

Market consolidation is set to continue in 2025, and mergers and acquisitions will create opportunities for both established players and emerging companies to expand market share and access new resources.

“Those who have the cash and ability to expand can find great deals from those who are out of time,” Steven Ernest, vice president of originations for Chicago Atlantic, said at MJBizCon in early December. “It is always darkest before the dawn, and now is the time to be aggressive and acquire cash flow-generating assets.’

At the state level, recreational cannabis is legal in 24 states, while medical cannabis is legal in 40. Minnesota is the only emerging market to date, with the launch of recreational sales slated to begin in 2025, although there have already been delays. A bill to legalize medical marijuana was also recently re-introduced in South Carolina.

The hemp sector, a significant part of the cannabis market, faces a dynamic landscape. While the 2018 Farm Bill legalized hemp cultivation, the proposed Rural Prosperity and Food Act takes a more restrictive approach to the definition of hemp by considering all forms of THC, not just delta-9, and capping the total THC content at 0.3 percent.

This potential shift could impact the regulation of CBD and other hemp-derived cannabinoids, creating both opportunities and challenges for hemp businesses as they adapt to changes.

Companies Worth Watching

Major players Curaleaf (TSX:CURA, OTCQX:CURLF), Trulieve (CNSX:TRUL,OTCQX:TCNNF), Green Thumb (CNSX:GTII, OTCQX:GTBIF), Verano (OTCQX:VRNOF) and Tilray (NASDAQ:TLRY,TSX TLRY) continue to dominate the retail and production space, holding significant market share.

Meanwhile, Canopy Growth (NASDAQ:CGC,TSX:WEED) possesses an advantage with its sizeable patent portfolio, a testament to its commitment to research and development.

Lesser-known retailer and producer Goodness Growth was rebranded as Vireo Growth (CSE:VREO, OTCQX:VREOF) in July and underwent a leadership transition in October. The company reported solid Q3 results, and CEO Amber Shimpa, expressed optimism about Vireo’s prospects, particularly in the burgeoning Minnesota market.

On December 18, the company raised US$75 million in equity financing and announced its intention to expand its market share with the acquisition of four single-state operators.

As the cannabis industry continues to mature, these and other companies will be battling for dominance in a rapidly evolving market.

Chart via US Global Investors.

Investopedia’s more recent analysis continues to support the ‘January no-effect’ position. Looking back three decades since the 1993 inception of the SPDR S&P 500 ETF Trust (ARCA:SPY), investment advisor and global market strategist James Chen points out that in the last 31 years ‘there have been 18 winning January months (58%) and 13 losing January months (42%), making the odds of a gain only slightly higher than the flip of a coin.’

The past two years, the markets have performed strongly in January. January 2023 saw the S&P 500 jump 5.8 percent over the course of the month after falling at the end of December. However, markets fell back down through February and March, making the rally short lived.

In January 2024, the S&P 500 dipped slightly at the start of the month but ultimately closed January up 2.12 percent higher than its open. Unlike the previous year, the index continued that upward trend through the end of March, at which point it was up 10.73 percent from the beginning of the year.